The 2014 Records of Thompson Company Showed Beginning Inventory,$6,000;cost of Goods

question 60

Multiple Choice

The 2014 records of Thompson Company showed beginning inventory,$6,000;cost of goods sold,$14,000;and ending inventory,$8,000.The cost of purchases was:

• A)$12,000.
• B)$10,000.
• C)$9,000.
• D)$16,000.

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Definitions:

Conversion Costs

Costs associated with converting raw materials into finished products, including labor and manufacturing overhead.

Enameling Department

A specific division within a manufacturing facility focused on the process of applying a vitreous enamel coating to products.

Conversion Costs

The costs involved in converting raw materials into finished products, including labor and overhead.

First-In, First-Out

An inventory valuation method where the goods purchased or produced first are sold or used first.